In electrical systems, devices such as inductors may draw electric current and cause a voltage drop but may not actually dissipate power. By drawing current and causing a voltage drop, these devices may give the appearance that they dissipate power. The power that devices appear to dissipate may be referred to as reactive power, while the actual power dissipated in a circuit may be referred to as the true power. The total power used by a circuit is the sum of the true power dissipated and the reactive power.
Electric motors, because they are inductive devices that draw current and cause a voltage drop, are sometimes the cause of reactive power in a power distribution system. For electrical induction motors used in large industrial applications, the current drawn during startup of the motor, referred to as inrush current, can be significant, and may result in a correspondingly large voltage drop, which may be referred to as voltage sag, appearing to the power supplying system. Such large voltage drops can negatively impact the operation of the power supply grid as well as other systems connected to the power grid. Large increases in the demand for reactive power may negatively impact the power quality in the distribution grid and/or result in other customers experiencing a significant drop in electrical current. To avoid the negative impact resulting from large and sudden demands for reactive power, some power generating organizations impose requirements to minimize or limit the reactive power demanded by customer systems.